I came across this concept while looking through my notes, so I thought I’d share it.
The annualized returns shown on DeFi pages are usually estimates based on the current yield. Yields can change, so that figure doesn’t mean you’ll actually earn that amount after a year.
For the same pool, the APY is generally higher than the APR. When comparing different products, make sure you’re comparing the same metric.
$CAKE is PancakeSwap’s native token. DeFi app pages like this often display annualized returns.
If you learned something, leave a comment. If anything’s unclear, ask away in the comments.